Saving for retirement vs. a new car
We know you need a car to go about your daily life. Below are four key tips to save money on your new car: start a bidding war for your new car and your trade in, bring your own financing, consider a used car, and be smart about when you buy.
Don’t sacrifice your future. Rather than thinking about it as a choice between saving for retirement and saving for a new car, reduce your car costs and save for both. You don’t want to be stuck in your house all day (or driving around a clunker!) when you’re retired because you didn’t save for retirement.
Tip #1: Start a bidding war
First, decide on your desired car and model. Then email several local dealerships and ask for their best offer on your specific car and features. Online salesman often offer lower rates than in-person salesmen.
Make sure you’re specific about the features you want with your model so the dealer can’t add on fees later. If you’re also trading in a car, ask each dealer what their best offer would be for your trade in as well.
Then take the best offer you receive and email the dealers again asking if anyone will match or beat the top offer. Shopping around for the best possible price online can save you thousands.
Tip #2: Buy used
You can buy lightly used cars and save thousands of dollars. If you find a car you like, ask yourself when the new version of that car debut.
For example, the Honda Accord was revamped in 2013. All models from 2013-2016 use a similar platform, features and styling. You can buy essentially the same car for significantly less! Don’t fall for the allure of a new car.
Tip #3: Bring your own financing
Remember, the “Financing and Insurance” department at many dealerships is where car buyers get ripped off. Do some homework beforehand on financing. Talk to some local banks or credit unions and see what the best auto loan offer you can get is. Know what a fair price is for an auto loan.
Go into that meeting with the Financing and Insurance department and control the conversation. Walk in and tell them “here are the financing offers I’ve found, can you beat this?” You’ll save a lot of money that way.
Tip #4: Be smart about when you buy!
Towards the end of the model year, dealerships will look to sell any older cars they have to make room for the upcoming model year. That means that August through October is usually a really good time to buy if you want to get the current model year at a discount.
If you can’t wait to buy in August, September, or October, sometimes you can get a better deal by buying at the end of the month. At the end of the month the sales staff is often trying to make its quota and will cut you a discount.
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